A bipartisan measure that would require prescription drug discounts to be shared with Georgia consumers failed in the Senate.
The bill focused on benefit managers in pharmacies, who act as intermediaries between health insurance companies and prescription drug manufacturers. These pharmacy benefit managers negotiate rebates with manufacturers on behalf of insurers in the form of rebates.
“Unfortunately, the PBM often retains much or all of the rebate rather than passing the rebate or the benefit of the rebate on to the patient,” said Rep. Mark Newton, an Augusta Republican who is sponsoring the bill.
Newton has tried to make the case this session that lawmakers should step in and require these third parties to share the savings with consumers in hopes of lowering their out-of-pocket costs, especially when it comes to newer drugs.
“They make that profit, and a big part of it is not passing it on to drive down premiums, but passing it on to their shareholders, which I don’t usually mind doing until it gets too high,” Newton said. “And when excessive profit-making harms patients, I think it is our duty at that point to step in and defend the patient.”
The bill would require pharmacy benefit managers to share at least 50% of the discount with patients, although the changes would not apply to people covered by federally regulated health plans.
The proposal, which also includes reporting requirements to increase transparency, passed the House of Representatives early last month with a 168-3 vote. But it stalled in the Senate Health and Human Services Committee in the final days of the session, when it was narrowly defeated by a 5-6 vote.
Newton’s bill faced opposition from insurers, pharmacy benefit managers and the National Federation of Independent Business, which represents small businesses. Opponents argued the measure was unnecessary because point-of-sale discount plans are already available to employers and the changes requested would drive up costs for everyone.
Newton acknowledged that premiums would likely increase, but said they would be minimal. He also argued that his bill could reduce costs in the long run by making prescriptions more affordable and helping patients take them more consistently.
However, the proposal was also met with some skepticism about its potential to help consumers.
“It seems to me that the problem is that the prices of these drugs are extraordinarily high,” said Sen. Kim Jackson, a Democrat from Stone Mountain. “And I have a hard time understanding how that changes. So what would stop a pharmaceutical company from simply increasing the price further while offering a discount?”
The bill remains in place for next year, and advocates say they will be back.
“Insurers and PBMs are fighting for their profits. Patients are fighting to save our lives,” said Dorothy Leone-Glasser, executive director of Advocates for Responsible Care.
